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The substitution effect F E(associated with a move from A to D) change the relative prices of food and clothing but keeps real Income (satisfaction)constant. The income effect EFz(associated with a move from D to B)keeps relative prices constant but increases purchasing power. Food is a normal good because the income effect EF2 is positive.The substitution effect F1E (associated with a move from A to D) change the relative prices of food and clothing but keeps real Income (satisfaction) constant. The income effect EF2 (associated with a move from D to B) keeps relative prices constant but increases purchasing power. Food is a normal good because the income effect EF2 is positive
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